Explained: Why India has banned imports of goods made with forced labour

The government has amended the Foreign Trade Policy (FTP) 2023 to prohibit the import of goods produced using forced labour, a move that comes amid a US investigation into forced labour practices in 60 countries, including India, PTI reported.

According to a gazette notification dated 13 July, the Directorate General of Foreign Trade (DGFT) has inserted a paragraph in the Foreign Trade Policy stating: “The import of goods produced or manufactured, wholly or in part, through the use of forced labour is prohibited."

The notification does not immediately ban any products or imports from specific countries. Instead, it empowers the government to prohibit identified goods through future notifications after investigations conducted by the DGFT, PTI reported.

The notification further states that its provisions will come into effect 30 days after publication in the Official Gazette.

What has changed in Foreign Trade Policy?

Under the amended Foreign Trade Policy, the central government now has the authority to prohibit the import of specific goods if it finds, based on an inquiry or other relevant evidence, that those goods were produced using forced labour.

The procedure for conducting such an inquiry will be prescribed in the Handbook of Procedures, 2023.

PTI reported that the DGFT has also inserted a new definition under Chapter 11 (Definition) of the FTP, 2023. It defines "Forced Labour" as all work or service exacted from any person under the menace of any penalty and for which the person has not offered himself voluntarily, in line with the ILO Forced Labour Convention, 1930 (No 29).

Why has India made this amendment?

According to PTI, the development comes as the US Trade Representative (USTR) is conducting Section 301 investigations into 60 economies, including India, over concerns related to forced labour. The USTR has alleged that these countries have failed to enforce import bans on goods produced using forced labour.

On 3 June, the US proposed imposing a 12.5% tariff on imports from 54 countries, including India, for allegedly failing to prohibit the import of goods produced with forced labour.

Six countries—Canada, Ecuador, the European Union, Indonesia, Mexico and Pakistan—would face an additional 10% import duty because they have introduced domestic measures prohibiting imports made with forced labour.

India is also engaged in negotiations with the US on a Bilateral Trade Agreement (BTA), making the amendment significant in the broader trade context.

Does notification immediately ban any imports?

No. The notification does not immediately ban any products or imports from any country. Instead, it creates a legal framework that allows the government to ban identified goods in the future, after investigations by the DGFT establish that they were produced using forced labour.

Commenting on the development, the think tank GTRI said the notification establishes a legal framework rather than imposing an immediate import ban, as reported by PTI.

"Its effectiveness will depend on how the government conducts investigations, the evidence required to establish forced labour, and the products it ultimately targets," GTRI founder Ajay Srivastava said.

What could be impact?

Srivastava told PTI the notification signals that India is strengthening its domestic legal framework in line with international standards, a step that could reinforce its position in future trade negotiations and market-access discussions.

He said the US authorities consider products such as cotton, textiles, solar-panel polysilicon, seafood, metals, batteries and electronics particularly vulnerable to forced-labour risks, especially when linked to China's Xinjiang region. "Yet the US and the EU continue to import many such products from China, underscoring the challenges of enforcing forced-labour rules," he said.

Agneshwar Sen, Trade Policy Leader at EY India, told PTI that by adopting the definition contained in the ILO Forced Labour Convention, 1930 (No. 29) verbatim, India has aligned itself with the same international benchmark used by the US. "This is the principled core: India is not merely rebutting the US charge; it is asserting that it too can police forced labour in its supply chains, including, implicitly, goods produced through prison or bonded labour anywhere, not just those the US flags," Sen said.